Interview with Segun Adaju, Consistent Energy Limited

Sunday October 15th, 2017 - Smart Villages

Segun Adaju, CEO at Consistent Energy Limited

“I think Nigeria has the biggest market for this kind of business in all of Sub-Saharan Africa.”

To get a sense of Nigeria’s problems in the energy sector, it helps to know that more 60 million people in the country have their own gas-powered generators. In many city streets, a generator churns outside every business, pumping out pollution and costing Nigerians more than US$1.5 trillion a year in fuel costs.

That problem caught the attention of former banker Segun Adaju, who had transitioned away from his first career to work more directly on Nigeria’s problems with poverty. He soon came to believe that access to energy was key to solving those problems. “Most rural dwellers stay in poverty because they don’t have energy to process their farm products,” Adaju says. “They lose almost half of what they harvest.”

In 2012, Adaju attacked that problem by founding BlueOcean Nigeria, a nonprofit organisation that focused on displacing kerosene lanterns with solar ones. From 2012 to 2015, the group deployed more than 10,000 small solar products to people living in rural areas of the country. Most customers finished paying off their lantern in two to four months, Adaju says, primarily with savings from not buying kerosene. That work improved the lives of customers, especially women who sell fish and vegetables at night and need light to work by.

But small business owners consistently said they wanted larger, more robust technology capable of replacing their generators and powering their barbershops, farms, and hair salons. In 2016, Adaju launched a pilot version of a new firm, Consistent Energy, with those clients in mind. This time, he chose a for-profit business model, and capitalised it with US$50,000 of his own savings. With additional investments from other former bankers, the company has now raised about US$200,000.

Consistent Energy’s most popular product is a mid-sized solar system that includes a 300W rooftop solar panel with a 650W inverter and a 150A battery. These business-scale units cost between US$900 and US$1,500, depending on the specifications of the technology. Consistent requires a down payment of about 10 per cent, followed by payments on a weekly basis. Most customers take 18 to 24 months to pay off their purchase.

Adaju says the primary beneficiaries tend to be women and girls. Part of the reason for that is that women tend to be the ones who spend time seeking fuel for the generators, so displacing generators with solar power saves them time. The systems also increase the income they make from their microbusinesses, and reduces the pollution they inhale.

Consistent Energy hasn’t limited itself to solving household-level problems. It has signed on to collaborate with the United Nations Development Programme on the rehabilitation of Nigeria’s northeastern region, which was thrown into crisis by the actions of the armed Islamist group Boko Haram. “The idea is to rehabilitate some refugees and internally displaced persons in Bono State,” Adaju says. “That region has the best sun in Nigeria: seven to eight peak sun hours.” He hopes that better access to solar technology will help get displaced people from northeast Nigeria back to their villages and avoid what he calls “an impending human rights crisis.”

The main challenge faced by the company is financing, which so far has come entirely from the personal savings of Adaju and his contacts. Adaju says the company is ready to scale and is seeking capital from angel investors, Nigeria’s Bank of Industry, and the African Development Bank.

Nigeria’s policy environment is a second challenge. “Unlike in other countries, where clean energy is being encouraged with tax rebates and exceptions, in Nigeria it’s not like that,” Adaju says. “There’s no waiver, no incentives.”

Yet Adaju is convinced that the opportunities for his company are strong. He points out that more than 65 per cent of Nigerian neighbourhoods are not connected to the grid—a total of at least 70 million people. And even those who have grid access usually get only four to five hours of power each day. Adaju knows these problems firsthand. “As I speak to you right now, our office is completely powered by solar,” he says. “We have not had grid power for several days.”

He sees access to renewable energy as key to the development of the Nigerian economy. “It’s just about the idea of creating energy for development and acting as a catalyst for development. So energy for productive use, energy for the agricultural value chain, for health care, for education, for infrastructure.”

Adaju is hopeful that his company will be part of that potential transformation. “We want to be the standalone rooftop solar company in Nigeria,” he said. “Between now and 2030, we’d like to have one million beneficiaries. So that’s the kind of vision we’ve set for ourselves. We’re hoping to quickly raise enough capital and deploy it.”